Brazil BSE ban to stay

BRAZIL's issues with bovine spongiform encephalopathy (BSE) are not going away in a hurry.

Since the announcement of its first case of BSE, describing it as "atypical" on December 7, 10 countries have imposed full or partial bans.

Many export and import countries were concerned about the two-year delay between when the BSE cow was first tested and the finding which was only released in early December, 2012.

The concerns raised by these countries has now resulted in Brazil's government and the World Organisation for Animal Health (OIE) to further investigate Brazil's transparency in their BSE surveillance system and testing processes.

The following are the countries who have introduced partial and full bans since the announcement South Korea, China, Japan, South Africa, Saudi Arabia, Peru (full ban for 90 days), Chile, Jordan (only beef from Parana State), Taiwan (processed beef-only) and Lebanon (Parana State).

The combined export volume of these countries equates to 150,000 tonnes of beef per year or 12.5 per cent of Brazil's total exports.

The export opportunities for Australia may be limited due to the other cheaper beef supply countries, with FMD (foot and mouth disease) beef, that export to the same countries as Brazil.

Russia being the potential exception for Australia due to the heavy tariffs imposed on countries like India at 31pc duty, its annual import needs of 220,000t of beef could prove to be a boon for Australian exporters.

Brazil makes WTO threat

On December 21, Brazil threatened to take action through the World Trade Organisation (WTO) unless the countries that have imposed bans on Brazilian beef reverse their decisions by March.

These actions had the opposite impact, with five additional countries imposing bans since the WTO threat was announced.

There is no doubt the initial response by Brazil was to try to as quickly as possible play down the impact of the BSE case and to 'pull into line' the importers that had banned Brazilian beef by threatening to take them to the WTO.

But instead raised further concerns by more countries about Brazil's BSE surveillance procedures, with more country's asking the same question why was there a two-year delay on results being made known?

The US Ranchers-Cattlemen Action Legal Fund (R-CALF) raised directly with the OIE their additional procedure concerns about the long delay between the confirmed two positive tests six months to be exact.

After the brain sample tested positive in mid-2012, it was sent to the OIE reference laboratory in the United Kingdom, where it again tested positive for BSE on December 6, 2012.

Officials allegedly claim the long delay between the two primary tests was due to a combination of a work overload at the testing laboratory and OIE rules that caused Brazil to lower the priority of testing the suspect cow.

BSE audits to be conducted

On January 5, Brazil's agriculture ministry confirmed the country's beef industry would be thoroughly audited.

State government teams would be sent to beef producers to ensure procedures to safeguard cows' health were being properly followed.

A review on all operational procedures would be made in accordance with OIE guidelines.

Ministry of Agriculture international relations secretary Celio Porto said the audit will start by looking at what possible failures may exist in the fight against BSE.

This decision seems to be made on the back of the OIE scientific committee announcing it will examine Brazil's BSE risk status and conduct an audit next month.

The decision by the OIE to do this audit seems to be related to R-CALF questioning of not just Brazil's BSE surveillance systems but also the OIE's procedures.

R-CALF regards the two-year delay as a symptom of the failure of the OIE's global system that they believe incorrectly assumes foreign countries, particularly developing countries, have the same means, commitment and capabilities as the US to control and eradicate diseases.

The OIE annual meeting is to be held in May at which the findings of their Brazilian audit and any recommendation would be tabled and considered.

In essence, the credibility of not only Brazil's BSE surveillance system has been questioned but also the OIE's global system.

A negative OIE review would be disastrous for Brazil, which could lead to potentially more bans from import countries or at best the current bans remaining in place for an extended period.

It would seem obvious to me that no country is likely to remove bans before May until the findings of the OIE review are made public.

The message is clear those countries that have imposed bans are needing transparency in the current Brazil BSE surveillance system and a credible reason why there was a two-year delay in the findings.

Russia to review its position

Russia's decision to wait and evaluate the situation is based on the comforting fact that back in 2011 Russia imposed bans on three Brazilian States Mato Grosso, Parana, Rio and Granda do Sul.

These bans are still in place and Parana, which was the State that the atypical case was found in, has not shipped beef to Russia in almost 18 months.

The concerns at the time related to sanitary issues and since then 85 export establishments from these three States have been prevented from exporting.

The need for transparency in any countries BSE surveillance system and testing processes can not be underestimated and Brazil is no exception.

An independent and credible body, such as the OIE, is critical to ensure that all importing countries can see correct procedures have been followed and similar occurrences won't be repeated.

Until these concerns are met, Brazil's beef exports future among the 10 countries with bans in place will remain uncertain.